Companies normally use a leasing model for durable goods, such as cars or heavy machinery. But Dutch entrepreneur Bert van Son thinks it could have a role for other products, too--like jeans.
A few weeks ago, Van Son, who owns a small line called Mud Jeans, launched a new service allowing people to rent, rather than buy, his products. He figured that he might not make much money up-front. But it might allow him to gather valuable fabric after use, and perhaps cement loyalty with his customers.
"We thought it must be possible to get our jeans back somehow, and reuse them in the recycle process," he says. "So, we thought, 'Why not stay the owner of the jeans and let people use the jeans, rather than owning them?'"
Customers pay a one-off 20 euro fee ($27), covering shipment and admin, and then 5 euros a month for a year (80 euros in total). At the end of the contract, they have three options. They can send the jeans back. They can get a new pair, paying a reship cost and the lease fee. Or, they can choose to keep the jeans, paying another four months at 5 euro plus a further 20 euro deposit. That goes towards another pair, when they eventually need one. Since launching in January at a jazz club in Amsterdam, several hundred people have signed up.
The jeans are made of a high-end organic cotton from Turkey, which is "quite expensive" and hard to source. So, it makes sense to increase the proportion of recycled, or off-cut, material. At the moment, that’s about about 40%. But Van Son thinks he could get it to about 50%, if he gets the leasing scheme right (it’s not possible to go fully recycled, as long, virgin, strands are needed initially).
When the jeans come back from the user, they are either washed, repaired, and put back into service, or shredded and sent back to the factory. "Cotton is a very big polluter in our world. Even organic cotton uses a lot of water. So, if there is a way of helping, it’s good," Van Son says.
He doesn’t expect to make a lot of money--though it’s early, and it’s possible publicity will give it a boost. "I had a hard time talking the bankers through this concept," he says.